Citadel's yuan fundraising in China first by an international hedge fund

PUBLISHED : Wednesday, 21 May, 2014, 1:52pm
UPDATED : Thursday, 22 May, 2014, 12:50am

A unit of Citadel became the first international hedge fund to complete yuan fundraising from wealthy individuals and companies on the mainland.

Citadel (Shanghai) Foreign Investment won regulatory approval for currency exchange on March 26, making it the first qualified domestic limited partner to have successfully completed fundraising on the mainland, according to a statement from the Shanghai government's information office.

Shanghai started the partner programme last year to allow international hedge funds to raise capital in yuan on the mainland for overseas investments.

The country's leaders have pledged to promote freer movement of capital in and out of the country and make the exchange rate more market-based for investment purposes.

"It's an innovative move to promote capital account convertibility and to build Shanghai into an international financial centre," the statement said.

The unit of Chicago-based Citadel, one of the first batch of international hedge funds approved for the programme, won US$50 million of quota in July last year, the statement said. It began to raise money after receiving a business licence on August 30.

Five other hedge fund companies - Man Group, Winton Capital Management, Oaktree Capital Group, Och-Ziff Capital Management Group and Canyon Partners - were also approved, the 21st Century Business Herald newspaper reported in September last year.

Investors in the programme consist mostly of wealthy individuals, private companies and large financial institutions, the statement said.

Citadel has US$18 billion in assets, according to the statement.